Medicaid Third Party Liability Act
This bill modifies requirements relating to Medicaid third-party liability.
Current law generally requires legally liable third parties (e.g., health insurers) to pay claims before Medicaid. However, Medicaid must pay first (and seek reimbursement from liable third parties) for claims for (1) preventive pediatric care, and (2) services for an individual for whom child support enforcement is being conducted by the state. The bill repeals these exceptions.
Current law also requires state Medicaid programs to take all reasonable measures to identify legally liable third parties. The bill specifically prohibits federal Medicaid payment for services to individuals for whom third-party insurance information was not obtained and verified by the state.
[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 497 Introduced in House (IH)]
<DOC>
119th CONGRESS
1st Session
H. R. 497
To amend title XIX of the Social Security Act to provide clarification
with respect to the liability of third party payers for medical
assistance paid under the Medicaid program, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
January 16, 2025
Mr. Crenshaw introduced the following bill; which was referred to the
Committee on Energy and Commerce
_______________________________________________________________________
A BILL
To amend title XIX of the Social Security Act to provide clarification
with respect to the liability of third party payers for medical
assistance paid under the Medicaid program, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Medicaid Third Party Liability
Act''.
SEC. 2. MEDICAID THIRD PARTY LIABILITY.
(a) Removal of Special Treatment of Certain Types of Care and
Payments Under Medicaid Third Party Liability Rules.--Section
1902(a)(25) of the Social Security Act (42 U.S.C. 1396a(a)(25)) is
amended by striking subparagraphs (E) and (F) and redesignating the
subsequent subparagraphs accordingly.
(b) Clarification of Role of Health Insurers With Respect to Third
Party Liability.--Section 1902(a)(25) of the Social Security Act (42
U.S.C. 1396a(a)(25)), as amended by subsection (a), is further
amended--
(1) in subparagraph (F) (as so redesignated), by striking
at the end ``and'';
(2) in subparagraph (G) (as so redesignated), by striking
the period at the end and inserting ``; and''; and
(3) by adding at the end the following new subparagraph:
``(H) that, in the case of a State after January 1,
2026, that provides medical assistance under this title
through a contract with a health insurer (including a
group health plan (as defined in section 607(1) of the
Employee Retirement Income Security Act of 1974), a
self-insured plan, a fully insured plan, a service
benefit plan, a managed care organization, a pharmacy
benefit manager, or any other health plan determined
appropriate by the Secretary)--
``(i) such contract shall specify--
``(I) whether the State is
delegating to such insurer all or some
of its right of recovery from a
responsible third party for an item or
service for which payment has been made
under the State plan (or under a waiver
of the plan); and
``(II) whether the State is
transferring to such insurer all or
some of the assignment to the State of
any right of an individual or other
entity to payment from a responsible
third party for an item or service for
which payment has been made under the
State plan (or under a waiver of the
plan); and
``(ii) in the case of a State that elects
an option described in subclause (I) or (I) of
clause (i) with respect to a health insurer
(including a group health plan (as defined in
section 607(1) of the Employee Retirement
Income Security Act of 1974), self-insured
plan, a fully insured plan, a service benefit
plan, a managed care organization, a pharmacy
benefit manager, and any other health plan
determined appropriate by the Secretary), the
State shall provide assurances to the Secretary
that the State laws referred to in subparagraph
(G) confer to the health insurer the authority
of the State with respect to the requirements
specified in clauses (i) through (iv) of such
subparagraph.''.
(c) Increasing State Flexibility With Respect to Third Party
Liability.--Section 1902(a)(25)(G)(ii) of the Social Security Act (42
U.S.C. 1396a(a)(25)(G)(ii)), as so redesignated by subsection (a), is
amended to read as follows:
``(ii) accept--
``(I) the State's right of recovery
and the assignment to the State of any
right of an individual or other entity
to payment from the party for an item
or service for which payment has been
made under the respective State's plan
(or under a waiver of the plan); and
``(II) after January 1, 2026, as a
valid authorization of the responsible
third party for the furnishing of an
item or service to an individual
eligible to receive medical assistance
under this title, an authorization made
on behalf of such individual under the
State plan (or under a waiver of such
plan) for the furnishing of such item
or service to such individual;''.
(d) Verification of Insurance Status Required.--
(1) In general.--Section 1902(a)(25)(A)(i) of the Social
Security Act (42 U.S.C. 1396a(a)(25)(A)(i)) is amended by
inserting ``, including the collection of, with respect to an
individual seeking to receive medical assistance under this
title, information on whether the individual has health
insurance coverage provided through a third party (as described
in such paragraph) and the plan of such insurer in which the
individual is enrolled,'' after ``in regulations)''.
(2) FFP unavailable without insurance status
verification.--Section 1903(i) of the Social Security Act (42
U.S.C. 1396b(i)) is amended--
(A) in paragraph (26), by striking ``; or'' and
inserting ``;'';
(B) in paragraph (27), by striking ``of the
State.'' and inserting ``of the State; or''; and
(C) by inserting after paragraph (27) the
following:
``(28) with respect to any amounts after January 1, 2026,
expended for medical assistance for individuals for whom the
State has not obtained and verified, in accordance with section
1902(a)(25)(A)(i), information on whether such an individual
has coverage provided through a third party (as described in
such paragraph) and the plan of such coverage in which the
individual is enrolled.''.
SEC. 3. EFFECTIVE DATE.
In the case of a State plan for medical assistance under title XIX
of the Social Security Act that the Secretary of Health and Human
Services determines requires State legislation (other than legislation
appropriating funds) in order for the plan to meet the additional
requirement imposed by the amendments made under this section, the
State plan shall not be regarded as failing to comply with the
requirements of such title solely on the basis of its failure to meet
this additional requirement before the first day of the first calendar
quarter beginning after the close of the first regular session of the
State legislature that begins after the date of enactment of this Act.
For purposes of the previous sentence, in the case of a State that has
a 2-year legislative session, each year of such session shall be deemed
to be a separate regular session of the State legislature.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Energy and Commerce.
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